Chinese Checkers

It seems that all is not lotus blossoms and shark-fin soup in China these days … as one respected analyst has estimated that the economic growth rate there fell to 1.7% in the fourth quarter of 2014 versus the official rate of 7.4% … see: Breitbart Article. And one reason to believe that China might be experiencing such a GNP paroxysm is that the world-wide demand for commodities … oil, copper, steel, etc. … has also fallen off the shelf. If China, one of the primary drivers of the growth in such commodities, has experienced such an indicated slowdown, then it would follow that its requirements for these materials would also plummet.

As indicated in this very interesting article referenced above, the side effects of this economic slowdown in China is that it is exporting deflation and is beset by capital and labor outflows which put its large internal debt burden in a precarious position. China’s ability to manage its way through its current economic problems is far more consequential to world economic health than today’s political theater in Greece. As indicated, if China is forced to sell much of the $1.3 trillion of United States sovereign debt it now holds, interest rates here will naturally elevate … independent of the machinations of the U.S. Federal Reserve Bank. This would also strengthen the dollar more which, in turn, would then depress commodity prices even further.

It appears to this investor that the key to continued strength in world economies and stock markets is now held in Beijing and not in Washington and Brussels … or even in Riyadh,Saudi Arabia.

Good for Her!

Michelle Obama has refused to cover her head with a jihab when meeting with Saudi Arabian dignitaries as she and Barack stopped in Riyadh on their way back from India ... see: Yahoo News Story. This clearly-planned slight combined with our president's poor negotiating skills does not auger well for the Saudi's putting a stop to oil price declines which are damaging our oil-fracking industry. This combo already has probably cost us any such concessions ... but at least someone in this country has the chutzpah to stand up to these 9th century potentates.

(Barack, on the other hand, was again caught chewing gum while in India ... another pointless grade-school slight ... see: Politico Story.)

I don't often compliment our first lady, but in this case, "you go girl!"

Afterthought: I must have forgot ... President Obama hates the oil fracking industry in America ... so why would he try to protect it?